CAPITAL COST ESTIMATES

1. CAPITAL COST ESTIMATES INSTALLED EQUIPMENT COSTS

2. INSTALLED COST ESTIMATE METHODS • FOR TYPE 1 OR 2 FEASIBILITY ESTIMATE • USE PURCHASED EQUIPMENT COSTS AND FACTORS • SIMPLEST IS SIMPLY 4.0 FACTOR • FOR PLANT TYPE ADJUSTMENT SEE TABLE 6-10. RANGES ARE FROM 4.7 -6.0.7 • USE M&S INDICES FOR INFLATION COST SCALE-UP • FOR INDIVIDUAL EQUIPMENT, USE FACTORS FROM CHEMICAL ENGINEERING PLANT COST INDEX (ALSO IN CHEMICAL ENGINEERING MAGAZINE)

3. SPECIFIC PLANTS • THE TEXT HAS SOME PLANT DATA IN TABLE 6-11 • DATA IS SCALED UP FROM 1970 DATA SO IS IN QUESTION • MOST ESTIMATES ARE BASED ON EQUIPMENT COSTS • THAT EQUIPMENT COSTS CARRY AN ACCURACY LIMIT AS WELL • - +25% IS TYPICAL FOR PEP PROJECTS AT SRI

4. ESTIMATE EXAMPLE • EQUIPMENT FOR PROCESS MODIFICATION

5. ESTIMATE EXAMPLE • RELATIVE MATERIALS COSTS

6. FOR TYPE 3 FUNDING ESTIMATE • USE PROJECT DATA - DESIGN CRITERIA, DESIGN BASES, INITIAL SITE DATA • NEED STRUCTURAL DATA • NEED SHOP VS. FIELD FABRICATION DATA • NEED LABOR VALUES • USE VENDOR QUOTES FOR EQUIPMENT PLUS SHIPPING TO GET DELIVERED COSTS

7. FOR CONTROL BUDGET • NEED FINAL DRAWINGS • NEED QUOTATIONS FROM CONSTRUCTION SUBCONTRACTORS WHERE AVAILABLE • NEED SPECIFIC COSTS FOR EQUIPMENT, MATERIALS, LABOR AND ERECTION EQUIPMENT • NEED DEFINITION OF SHOP VS. FIELD RESOURCES

8. CAPITAL ESTIMATE COMPONENTS • DIRECT FIXED CAPITAL • INCLUDES COMPONENTS AS PER TABLE 6-3 • DEFINITION SUMMARY (TABLE 6-9) TOTAL PLANT CAPITAL (TPC) = TOTAL PLANT DIRECT CAPITAL (TPDC) + TOTAL PLANT INDIRECT COSTS (TPIC) + WORKING CAPITAL (WC) TPC = TPDC + TPIC+ WC

9. FEASIBILITY ESTIMATE • DEVELOP PEC AND USE PEC FACTORS METHOD • TYPICAL FACTORS FOR ESTIMATE COMPONENTS ARE IN TABLE 6-3 & 6-17

10. INSTALLATION COSTS • DEPENDS ON AMOUNT OF PIPING VS. SOLIDS HANDLING (NON-SLURRY) • INCLUDES FOUNDATION AND STRUCTURAL BUT NO INTERCONNECTING SYSTEMS • IF ESTIMATED ON AN EQUIPMENT ITEM BASIS, SEE TABLE 6-5 FOR TYPICAL VALUES • PROCESS PIPING FACTOR • RANGES OVER PLANT TYPE FROM SOLIDS ONLY TO FLUIDS ONLY • SEE TABLE 6-6 FOR FACTORS

11. INSTRUMENTATION FACTORS • RANGE FROM MANUAL TO TOTAL COMPUTER CONTROL, 10% - 50% OF PEC • MOST PLANTS USE THE 35% LEVEL WITH DISTRIBUTED CONTROL SYSTEMS • BATCH OR INTERMITTENT OPERATION THROUGH PROGRAMMABLE CONTROLLERS • FOR A DISCUSSION OF THE USE OF WIRELESS INSTRUMENTATION : http://www.automationworld.com/view-1936

12. OTHER FACTORS • INSULATION FACTORS • USED FOR CONTROL OF HEAT LOSS, HEAT GAIN AND PERSONNEL PROTECTION • TOTALS RUN AROUND 8% OF PEC • ELECTRICAL FACILITIES FACTOR • DOES NOT INCLUDE CONTROL, BUT DOES INCLUDE POWER SUPPLIES. • ASSUMES POWER FROM SOURCE OUTSIDE OF BATTERY LIMITS • AMOUNTS TO ABOUT 15% OF PEC • SEE COMPONENTS IN TABLE 6-8

13. OTHER FACTORS • BUILDINGS FACTOR • DEPENDS ON CRITERIA FOR JOB • FOR EXISTING PLANTS, • TYPICAL VALUES ARE SHOWN IN TABLE 6-9 • YARD IMPROVEMENT • INCLUDES ALL THE CIVIL ASPECTS OF THE PROJECT • INITIAL GRADING • UNDERGROUND UTILITY SYSTEMS • TRANSPORTATION COMPONENTS • AND FINISH OUTSIDE OF PROCESS AREAS

14. OTHER DIRECT COSTS • AUXILIARY SYSTEMS • THE UTILITY COMPONENTS FROM OUTSIDE THE BATTERY LIMITS REQUIRED FOR OPERATION • MAY INCLUDE UPGRADE OF EXISTING UNITS.

15. INDIRECT COMPONENT FACTORS • ENGINEERING COSTS • INCLUDE COSTS FOR DESIGN THROUGHOUT THE PROJECT. TEND TO INCLUDE ASPECTS OF CONSTRUCTION. • VALUES ARE SHOWN AS TOTAL IN TABLE 6-9 • CONSTRUCTION • INCLUDES ADMINISTRATION OF ALL ASPECTS OF PROJECT • DEPENDS ON MANY FACTORS AS INDICATED IN TABLE 6-9

16. INDIRECT COMPONENT FACTORS • CONTRACTORS FEE • PROFIT AND OVERHEAD COMPONENT FOR ENGINEERING AND CONSTRUCTION FIRMS • RANGES AROUND 4-6% OF TOTAL FIXED CAPITAL INVESTMENT • CONTINGENCY - ANTICIPATED COSTS FOR CHANGES THAT WILL OCCUR DURING THE PROJECT • FOR THIS PROJECT USE THE VALUES IN TABLE 6.17 AND EXPLAIN BASIS OF CHOICE

17. METHOD D - LANG FACTORS • BASED ON PEC (4.7x TO 6.0x PEC) • BASED ON CORRELATION FOR A LARGE NUMBER OF PROJECTS • OFTEN AS ACCURATE AS DETAILED FACTOR METHOD • TYPICAL LANG FACTORS ARE SHOWN IN TABLE 6-10